asked the Minister for Labour if he will make a statement on the prospects for the enterprise allowance scheme for the remainder of this calendar year.
20.
Ceisteanna—Questions. Oral Answers. - Enterprise Allowance Scheme.
6.
asked the Minister for Labour the reason for the discrepancy between the budget as set out in "Principal Features of the Budget" accompanying the Budget Statement on 31 March last for the enterprise allowance scheme under his Department's Vote and the published revised Estimates, as the "Principal Features of the Budget" envisaged a saving of £1.5 million and the revised Estimates allowed for a saving of £2.5 million, which represents a reduction of 26 per cent on the previous year; and if he will make a statement on the matter.
I propose to take Questions Nos. 6 and 20 together.
A revised enterprise scheme was introduced on 29 December 1986, which was designed to improve the effectiveness of the scheme by having greater regard to the personal business skills of applicants, the viability of the enterprise and avoidance of displacement of non subsidised operations elsewhere in the economy. These constraints would result in reduced expenditure under the scheme in 1987 and a budget of £9.744 million was originally allocated under subheads H and T of my Department's Vote. This compared with an expenditure out-turn of £11.273 million in 1986. The budget allocated was intended to cope with carryover commitments from 1986 and to permit an average admission of 80 persons per week in 1987 under the revised scheme.
There was a lower take-up in the initial months of 1987 under the revised scheme than the anticipated 80 new entrants per week. In the circumstances, I agreed with the Minister for Finance to reduce the original budget for the scheme in 1987 by £1.5 million to £8.244 million. This reduction was alluded to in "Principal Features of the Budget".
In regard to the prospects for the enterprise scheme for the remainder of the year, it is expected that the revised budget will adequately cater for demand under the scheme. No worthwhile projects which are eligible will be refused assistance.
Does the Minister agree that the enterprise allowance scheme has been one of the most successful interventions in the labour market, offering many thousands of people the opportunity to move from unemployment into self employment and then into entrepreneurship? Does he also agree that in those circumstances, the Book of Estimates provision for a 26 per cent reduction over last year's outturn is wholly unacceptable? Does he accept that his assurances to the House that worthwhile projects will not run into difficulties are not in accordance with what is happening in Manpower offices around the country where people are being put off when they go in to discuss worthwhile proposals?
The reduction taken into account was based on the figures available. The abridged volume of the Book of Estimates allowed for £9.744 million and the revised volume allowed for £8.244 million, a reduction of £1.5 million. If the Deputy has any other information I will be glad to look at particular cases but, under the scheme, there is room to cater for any proposals which are within the new guidelines issued in December last.
Does the Minister agree in general terms that if someone is unemployed but believe they have an idea which is worth considering, they should be encouraged and that there should not be an unduly critical or censorial attitude adopted? People who have the confidence to strike out on their own deserve every encouragement and it is unacceptable that there should be any element of selection or quota operated.
I agree with the Deputy but it was felt necessary to carry out a review last year with the aim of improving the scheme. It was not a particularly radical review, one point was that there should be a more precise screening of applicants with a view to achieving quality of submission rather than quantity in regard to concepts of viability and displacement, tighter administrative controls in relation to lump sum payments, devolution of the bulk of administration, greater emphasis on monitoring the black economy activities and a weekly payment related dependancy rather than marital status. These were all reasonable guidelines to build into this scheme and if they have reduced the intake there is a need to highlight the scheme which perhaps was not the case in recent months. I will review the matter if lower intakes continue.
Am I right in assuming the Minister said that after the review took place the revised scheme restarted last December and that the take-up was lower than had been expected? Did he agree with the Minister for Finance to reduce the expenditure on the scheme by a further £1.5 million although it had already been reduced in the proposed budget as set out in "Principal Features of the Budget"? Am I right in assuming that that all took place as a result of the revision of the scheme? Presumably there was a hiatus in which the numbers would fall.
There was a gradual decline in the numbers taking part in the scheme.
Could that be said to result from the administrative problems with the scheme? Did the Department not have the heart to continue it?
No, I agree with what has been stated by Deputy Birmingham. It is a good scheme but the take-up figures have not been high enough. I will continue to review the scheme as 80 new entrants per week are anticipated. As I said earlier, there may be a need to highlight the scheme to see if it could be made more attractive.
Does the Minister agree that a 26 per cent reduction in the proposed expenditure on this scheme is a scandal when you consider that we cannot offer jobs to people? We should be encouraging people to become as independent as possible and if even 50 per cent of those participating in the scheme become independent of State transfers that in itself is a recommendation for increasing the amount of money spent on the scheme and in highlighting it.
We will highlight the scheme but the figures are of little value as the scheme was not taking up the money available to it.
I submit there are reasons for that.
Perhaps it will be clear in a few months whether the figures level out. People who participate in the scheme are more likely to be in long term sustainable employment than in alternative schemes; I take the Deputy's point.
As the scheme has been streamlined and modernised, can the Minister say whether the Department will now be in a position to monitor the success rate of people at the end of the 52 weeks cycle with respect specifically to whether they are in self-sustainable employment or if they are entitled to revert to social welfare?
That is something which I would like to see done. At present, it is not part of the scheme. Some surveys were carried out by the Youth Employment Agency some time ago on different schemes. It was not built into the scheme last December.
There has been a reduction in the take-up which is to be expected after three or four years as there is a ceiling on the demand for many of these services. In order to fine tune the scheme, which has been a success, the displacement and the failure rates need to be measured and only the Department of Labour can do that now that the system is computerised. Is the Minister in a position to give an undertaking that he will try to do that?
We will certainly try to do so. The points I outlined earlier resulted from attempts to get to that position. We should have some way of continually monitoring schemes rather than letting them continue for a number of years without monitoring. There is no value in continuing a scheme which is purely short term.
A final supplementary from Deputy Brimingham.
When the Minister comes to the promotion of the scheme will he target it at those groups to whom the scheme has been of least benefit? I understand that only 13 per cent of participants have been women. Young people have not provided the proportion of participants that one might have expected and if the Minister is going to promote the scheme would he target his promotion at those groups in particular?
As I said, we will monitor the scheme for a few more months in order to highlight the areas of success. There is agreement that this scheme has been a success. In the meantime if the Deputies are aware of schemes where there are delays I would be glad to hear of them as I have been informed that there are no such difficulties.
Can I ask the Minister——
I had hoped to get on to the next question but if it is a brief question, Deputy, I will be glad to facilitate you?
Can the Minister tell me how the scheme can be viewed as a success if we do not know the success or failure rates of its participants?
In a later question I will give some of the figures.